New Tax Law - Witholding
 

Found this in NVG, figured I'd x-post here since it effects basically everyone here.

http://www.cardplayer.com/poker-news...ament-winnings

It doesn't change the amount you have to pay in taxes or anything - simply that money will be immediately withheld (like wages are at any other job).

Re: New Tax Law - Witholding
 

...omfg






what else can you say?

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This is an absolute [censored] disaster.

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This is an absolute [censored] disaster.

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God the US is so [censored] useless.

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This is an absolute [censored] disaster.

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QFT

Re: New Tax Law - Witholding
 

This really sucks re: backing situations.

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EPT/APPT/Aussie Millions/International WPT ftw. [censored] you US, see if you ever get me back.

Re: New Tax Law - Witholding
 

Cash games FTW?

Re: New Tax Law - Witholding
 

wtf!

Re: New Tax Law - Witholding
 

From the article:

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The ruling held that tournament poker is not a skillful competition and should be considered a gambling activity, at least for the purposes of taxation.

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I swear people who make these laws are 1. either losing poker players who assume they lose because of being "unlucky" or 2. don't bother to do conduct any real research to understand how poker in general and its concepts actually works.

Re: New Tax Law - Witholding
 

[ QUOTE ]
From the article:

[ QUOTE ]
The ruling held that tournament poker is not a skillful competition and should be considered a gambling activity, at least for the purposes of taxation.

[/ QUOTE ]

[/ QUOTE ]

when did aejones get into politics

Re: New Tax Law - Witholding
 

[ QUOTE ]
[ QUOTE ]
From the article:

[ QUOTE ]
The ruling held that tournament poker is not a skillful competition and should be considered a gambling activity, at least for the purposes of taxation.

[/ QUOTE ]

[/ QUOTE ]

when did aejones get into politics

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mlagoo - 1
rest of world - 0

Re: New Tax Law - Witholding
 

also, this really really sucks. i need to speak to an accountant about wtf im supposed to do moving forward.

Re: New Tax Law - Witholding
 

[ QUOTE ]
[ QUOTE ]
From the article:

[ QUOTE ]
The ruling held that tournament poker is not a skillful competition and should be considered a gambling activity, at least for the purposes of taxation.

[/ QUOTE ]

[/ QUOTE ]


when did aejones get into politics

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i lol'd pretty hard at this.

Re: New Tax Law - Witholding
 

This is going to hurt the tournament community in such a big way. Uncle Sam now gets a interest free loan from us degens and we get less money to Gamb00l up. Glad I don't live in the gold ol' U S and A

Re: New Tax Law - Witholding
 

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also, this really really sucks. i need to speak to an accountant about wtf im supposed to do moving forward.

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What's the issue "moving forward" if you intended to pay your taxes, anyway?

Re: New Tax Law - Witholding
 

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also, this really really sucks. i need to speak to an accountant about wtf im supposed to do moving forward.

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What's the issue "moving forward" if you intended to pay your taxes, anyway?

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seriously keep good backing records and pay your taxes like a good little us citizen

will they be witholding from countries the US has tax treaties with though? i.e. are canadians and europeans going to end up paying US taxes?

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will they be witholding from countries the US has tax treaties with though? i.e. are canadians and europeans going to end up paying US taxes?

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Huh? Don't players from tax-treaty countries already have their taxes withheld on US tournament cashes? They don't wind up "paying US taxes." As far as I understand, this new regulation isn't changing who owes tax where, it changes how and when it's collected.

Re: New Tax Law - Witholding
 

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also, this really really sucks. i need to speak to an accountant about wtf im supposed to do moving forward.

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What's the issue "moving forward" if you intended to pay your taxes, anyway?

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it seemed to me that this was going to make staking/being staked significantly more complicated. maybe i was off. and i just want to make sure i know what i need to do whenever i cash in a tournament.

Re: New Tax Law - Witholding
 

Yes, Canadians already pay a witholding tax (which is why I rarely go to US tourneys)

Ryan

Re: New Tax Law - Witholding
 

God bless.....Canada....

Re: New Tax Law - Witholding
 

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Yes, Canadians already pay a witholding tax (which is why I rarely go to US tourneys)

Ryan

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but you get the money that was withheld back at the end of the year from your own government, right? I don't see how it negatively impacts you.

Re: New Tax Law - Witholding
 

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also, this really really sucks. i need to speak to an accountant about wtf im supposed to do moving forward.

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What's the issue "moving forward" if you intended to pay your taxes, anyway?

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Not the end of the world if you pay your taxes but:

- The money from people who weren't going to pay taxes leaves the poker economy.

- Government doesn't immediately refund the same percentage from tournaments in which you don't cash, which hurts cash flow.

- Makes backing situations more confusing.

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Yes, Canadians already pay a witholding tax (which is why I rarely go to US tourneys)

Ryan

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but you get the money that was withheld back at the end of the year from your own government, right? I don't see how it negatively impacts you.

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Sure, If you've been playing straight on your taxes then you'll end up the same as you would have otherwise. (If we don't mention that you're making an interest free loan to the government with money that might have been earning you interest elsewhere.) But that assumes you're a winning player with an unlimited bankroll. Take away the unlimited bankroll and a winning player trying to exercise good bankroll management will be negatively impacted much more by a losing streak. The 25% you didn't get from that big win at the start of the year could make a big difference by the end of the year.

Take away both assumptions and it matters even more. The 25% withheld from the losing player is money he won't have to lose until sometime the next year.

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but you get the money that was withheld back at the end of the year from your own government, right? I don't see how it negatively impacts you.

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No. The tax withheld by the US gov is an "income" tax on me for my winnings in the US, the Canadian gov has nothing to do with it.

The only way to get any $$$ back to to file in the US and prove gambling losses, and get your $$$ back from the US gov.

For $$$ won in Canada, they are tax free as the Canadian gov doesn't view lottery or gambling winnings as "income".

Regards,
Canadian Woodguy

Re: New Tax Law - Witholding
 

Right.

Caveat is that investment income from gambling is taxed. It's just as well sports books are run by goverments in Canada anyway and redirected to charities.

Wanderin' Toranna/Newf. We always get the next joke, and we don't know where the hell it goes either.

Cheers.

Re: New Tax Law - Witholding
 

man I read through this whole thread before reading the article and got all worried, then realized its only for live poker. Whatever

Re: New Tax Law - Witholding
 

Is dmk's interpretation correct that nobody's going to be paying extra taxes, they're just gonna be paying them sooner (and losing interest I guess)?

Re: New Tax Law - Witholding
 

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Is dmk's interpretation correct that nobody's going to be paying extra taxes, they're just gonna be paying them sooner (and losing interest I guess)?

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Yes. It is the same as getting a paycheck at your job and getting money withheld for federal income taxes, then getting a refund check when you file in April. Also nuts to losing interest, people need that money to gambooooool.

Re: New Tax Law - Witholding
 

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Is dmk's interpretation correct that nobody's going to be paying extra taxes, they're just gonna be paying them sooner (and losing interest I guess)?

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That seems to be the correct interpretation, although it hasn't stopped several people from proclaiming their love for cash games, online poker and for being a non-US citizen. The new system, if it gets adopted by casinos, will be bad for people who don't file taxes and it will complicate some backing arrangements, but it should not change the total amount of one's tax liability.

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Can you explain how it will complicate backing arrangements?

Re: New Tax Law - Witholding
 

soon time to move

Re: New Tax Law - Witholding
 

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man I read through this whole thread before reading the article and got all worried, then realized its only for live poker. Whatever

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dude ty so much, ship the internet pokerings, WHEEEEEE

Re: New Tax Law - Witholding
 

This is really going to hurt live tournaments in the US. Some people may have a hard time showing their losses to get the withholding back and the reality is some amateur and professional players don't pay taxes on everything. So this will encourage people to play anything else, online MTTs, cash games, oversees, and tournaments at illegal clubs.

Re: New Tax Law - Witholding
 

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Can you explain how it will complicate backing arrangements?

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It will create major cash flow problems for backers, especially if they are doing it on a huge scale. Here's a chart I made for various ROIs which show the net cash flow for $200K of buy-ins. You'll eventually get the money back when you file your taxes, but it's a real hassle. Basically, you're going to have to have a 33 1/3% ROI to break even in terms of cash flow during the year:

Buy-Ins ROI Gross Net Withheld Net Cash Flow
200000 0.2 240000 40000 60000 -20000
200000 0.3 260000 60000 65000 -5000
200000 0.4 280000 80000 70000 10000
200000 0.5 300000 100000 75000 25000
200000 0.6 320000 120000 80000 40000
200000 0.7 340000 140000 85000 55000
200000 0.8 360000 160000 90000 70000
200000 0.9 380000 180000 95000 85000
200000 1.0 400000 200000 100000 100000

Sorry about the columns, they're straight when I type it in, 2P2's formatting is messing them up.

Given these issues, backers are probably going to be less willing to shell out the money since their return is being delayed, and/or will negotiate terms less favorable to the players. For example, a backer could make a player give the backer the amount of money withheld from the backer's share whenever the player cashes with an agreement to return the difference when the backer gets it back from the IRS. And makeup will have to be dealt with differently, since a player will not be able to get out of a hole, at least from a cash flow perspective, as easily now.

Re: New Tax Law - Witholding
 

Does anybody know how this would effect satellites?

Lets say you enter a $250 super satellite to the WSOP main event and win a $10,000 seat. Is there going to be withholding from that "tournament" to the tune of $2,500 leaving you only $7500 or enter the main event?

Re: New Tax Law - Witholding
 

As far as I know:

Tax wise satellites yelding non-transferable seats are considered a "parlay" bet - i.e. satellite wins are not taxable until you cash in the target tournament, and don't affect your agi.

Somebody should confirm this.

Re: New Tax Law - Witholding
 

I'm curious to whether this will spawn a new breed of low buy-in B&M tournaments, where the top N finishers all are paid $4,999.00.

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I thought it was 25% of money >5000?

Like you win 10,000, they withhold only 25%(10,000-5000)

Is that not correct?

Re: New Tax Law - Witholding
 

No I do not think that is correct. If you win a tournament that pays $5,100 they are not going to only withhold $250